Where can I get a fast business loan?

The main points

Online lenders usually offer the fastest financing for small businesses.

Traditional lenders, banks, and credit unions have strict collateral processes, and extended financing schedules.

The best fast lenders should have good customer reviews and an easy to understand application and financing process.

Sometimes you need fast business financing to meet an emergency or to fund a new business opportunity. Online and some traditional lenders can offer fast small business loans with an easy application process and financing within a few days or even the same business day.

However, quick small business financing options may come with less favorable terms, such as shorter repayment periods or higher costs, than traditional options, such as SBA or bank loans. Consider the pros and cons and what to look for when choosing an fast business loan.

Online lenders

If you want the quickest option for small business financing, getting a business loan may be the best option from an online lender. These lenders require minimal documentation and use software to simplify the approval process. Not only can you get approved faster, but funding is often within 48 hours.

For example, Fora Financial announces funds within 24 to 72 hours after approval, while Triton Capital could be an option for faster equipment financing. Some business lines of credit also provide same-day financing.

Pros

The fastest financing option

More eligibility requirements relax

Use the money for almost any purpose.

Cons

Business credit cannot be built

Less favorable loan terms - often only a few months

High borrowing costs

Who is the best?

Financing through online lenders can be ideal for startups, companies with limited credit histories, or companies with bad credit. Companies comfortable with technology may also appreciate the streamlined application process and less stringent approval guidelines.

Traditional lenders

As with traditional lenders, banks and credit unions often have a longer underwriting process with stricter credit requirements than online lenders. Many people only work with well-established companies. The usually long process extends to financing as well. But some lenders, such as PNC Bank, are able to fund unsecured loans in one to five days.

Traditional lenders usually have better interest rates, longer repayment terms, and larger loan amounts available.

Pros

Various types of loans are available with large amounts and favorable terms.

Face to face customer support

Able to build trade credit

Cons

Strict documentation requirements

Long application process and long time for financing

Most require a solid business history.

Who is the best?

Traditional lenders usually require well-established companies — often at least two years old — with good or excellent credit.

Invoice factoring /Invoice financing companies

An alternative to fast small business loans is bill collection. Invoice collection provides fast business financing to companies with unpaid invoices from their customers. The factoring company buys the outstanding invoices, paying the company between 70 percent and 90 percent of the value right away. The remaining funds are paid after the customer's invoice is satisfied minus the fees.

Invoice financing works the same way, but you'll collect the bills yourself rather than leaving them to the financing company.

Pros

Faster financing than traditional banks

Uses customer reputation rather than business.

A bill collection company takes care of collecting bills.

Cons

reduce profit margins.

Factoring fees may increase.

Balance funding may take up to 90 days.

Who is the best?

A business that bills other businesses is the best option for collecting invoices. This option can be good for businesses with poor credit because the billing company uses the customer's credit to determine eligibility. However, this financing option can be costly, as bad credit or a short payment to a customer can affect your business' profit margins.

What to look for in a fast business lender

Even if you want company finance rapidly, taking the time to explore the most popular fast business lenders might be beneficial. After determining the best loans and terms for your lending needs, each lender's application process, customer service, underwriting requirements, and financing speed will help you find the best business loan for your business.

The best fast business lenders must have:

• Good user reviews on sites like TrustPilot

• The ability to take a soft credit check during pre-qualification to avoid lowering your credit score.

• Competitive interest rates.

• The application process for financing is clear and easy to understand.

• There are no fees or other costs hidden in the fine print.

You may avoid fraudulent lenders by carefully reading the small print on the application and loan agreement. Once you have found the best lender for your financial needs and obtained financing, managing your fast business loan responsibly is key to avoiding default and penalties.

The red flags for a Fast business lender

When you need small business money quickly it can cause you to overlook red flags in a business lender. Keep these warning signs in mind when looking for fast business lenders:

• Application fee is required.

• Pay through the application process.

• Not showing the advance price and terms of the loan.

• Extremely high interest rates or additional fees.

• Making promises that the lender cannot keep, such as a guarantee of approval before an application is submitted.

Fast Business Loan Alternatives

Fast business loans have their pros and cons and may not be the right approach for everyone, especially if your business has less than ideal credit. Credit issues aside, fast business loans repayment terms and borrowing limits can be challenging. Some alternative quick loan options include:

Business credit cards

SBA Express Loan

Small loans

Peer-to-peer lending

Crowdfunding

Business grants

Listick Tip

SBA loans offered by the Small Business Administration may be a worthwhile option to consider. These loans cover the costs associated with running your business and are available to small businesses that have exhausted other financing options. According to the SBA's Weekly Lending Report, nearly 45,591 loan applications have been approved so far in 2023, and the average loan size was $474,468.

Bottom Line

Fast Small Business Loans can be a great way to get the financing you need right away. There are a number of fast commercial lenders available, from traditional banks to online lenders. The first step in getting a quick business loan is to identify a lender. Then, submit any necessary documents, apply and get approved, and get paid within the same day or a few business days.